Wondering Where Old People Should Invest Their Money In? |
Posted: May 14, 2019 |
Wondering Where Old People Should Invest Their Money In?Choosing a line of work and making a living is pretty much a natural part of our timelines. The majority if not all of us work for over 30 years before we retire. Being a habit for that many years, getting retired is a huge change which is even synonymous to starting a whole new life. For some people, it is uncomfortable to find themselves without a firm source of income. This is perhaps the reason why you see a good proportion of retirees putting their years of experience to good use and take up a different position as a consultant. But such is not the case for everyone. There are undoubtedly a lot of retirees who prefer to enjoy the rest of their lives without any work-related stress. After an entire era of following other people’s schedules and demands, they are looking forward to a period of well-deserved relaxation in which they can enjoy the fruit of all the hard work that they’ve put in over the years. If you are one of such people who is looking forward to a tension-free retired life, then you have landed on the right page. Without a source of income or an intent to take up a new work position, you are only left with the option of being sufficiently foresighted. You need to plan ahead and enough for your future. Nobody likes to be a financial burden on anyone. It wasn’t acceptable for you in the days of your prime youth and it surely isn’t going to be acceptable for you now that you have had a lifetime of taking up the responsibilities of your family to earn their respect and honor. There is no argument over the fact that the first decision that you are confronted with as soon as you retire is what to do with your retirement money. More often than not, there are two options in front of you; you can either invest the money that you have received and live a stable life out of the return on that investment, or you can keep it all in a savings account and take a chunk of it out every month as per your requirements. Don’t get us wrong, though. Depending on your current financial status and the goals that you have in mind for the rest of your life, both the options can turn out to be beneficial for you. Savings are more suited for the people who wish to live a simple life with their family and are not in search of a whole lot of adventures. Investment, on the other hand, is an option for a retiree who’s looking forward to traveling the world, go on adventures, and live the life to the fullest. If you identify yourself as the latter and are in search of fine investment opportunities to get the most out of your retirement money, then the good news for you is that we have your work cut short for you. With thorough research, we have created a list of top 4 investment opportunities that you must look into once you retire. 1. Start With InsuranceYes, we do understand the cringe you are feeling on the name of insurance. After all, you were looking forward to an investment that could give you aremarkable return on a monthly or annual basis. It is true that insurance sounds more like an expenditure rather than an investment. But what if we told you that getting an insurance policy is the wisest of all the investments that you will ever make in your lives? Truth is, you may feel all healthy and excited about the adventures of your life as a retiree, but you can’t run away from the fact that old age comes with a hidden price tag of deteriorating health. With the weakening of the body’s natural defense against the diseases, old age makes you more prone to get sick which, in the worst case scenario, can turn into a disability. Take critical illnesses like Arthritis, for example. It is highly likely that you can find an example in your folks of a retiree who is fighting a battle against Arthritis and trying his best to keep the disability under control. A quick scan of the healthcare cost in 2019 will give you a better idea of the importance of having health insurance. Did you know that it could cost you as much as a grand if you were admitted to a hospital for just one day? Think about it, aren’t regular hospital visits most frequently associated with the old age? In all honesty, failing to invest a part of your retirement money into a comprehensive health insurance plan is a gamble that can bankrupt you in a matter of days. With an insurance plan, you get the peace of mind that you are protected against the excessive health expenditures while still receiving the premium-quality services which ensure a better quality of life. Such a policy will cover the cost of preventive care, required treatment, critical illness, long-term disability and much more. 2. Mutual Funds Are Better Than Stock MarketNow that you are well protected against the unexpected healthcare expenditure and have decided to not be a part of the workforce anymore, it is time that you start to look for an investment opportunity that can create a constant stream of reliable income for you. As such, investing a part of your retirement funds into an equity-backed product is a commendable idea. Evidently, it is like the first instinct for the majority of retires to look for an investment option in the stock market. It is justified since being a volatile market, they can’t help but appreciate the promise of a rapid return on their investment. What’s unfortunate is that a lot of them fail to realize how deep the promise really is? Being positive is really a virtue. But when it comes to investing your life-long earnings into a financial market, it couldn’t hurt to be a little skeptical. The volatility of the stock market has the potential to translate into remarkable profits in a short period of time. However, the same volatility multiplies the risk by that many times as well and can bankrupt you just as quickly. Therefore, investing your money in awell-diversified mutual fund can lend you a hand in minimizing this risk of rapid price movements. In simpler words, investing in a mutual fund can provide an opportunity for you to get the exposure of the stock market without the risk associated with owning the individual stocks. 3. Annuities Are Your Best FriendsFor the people approaching retirement, an immediate annuity offers an investment product that ensures an investor with a stable monthly payment. The downside to annuity is that it is expensive and difficult to close, which are primarily the reason why most people won’t opt for it. On the other hand, however, what needs to be appreciated about annuities is that it is a rather convenient way of keeping the risk of investment at a bare minimum. Like any other investment, all you have to do is make sure that you are familiar with and have considered all of the rules regarding the annuity before heading towards making an investment in one. You can expect a pension of around five to six percent on your investment in an annuity and it is known to be completely taxable. A word of caution, though, the capital that you invest that is commonly referred to as the corpus is not returnable. The investment with which you bought an annuity can’t be returned back to you. The best part of investing in an annuity is that depending on the package that you chose, the pension can continue even after your life. You can have your spouse as the legal rightful recipient of your pension or it can even further be transferred to your heirs. The original capital invested, however, is not returnable in any of the annuity packages. Take Home MessageAs evident from the information mentioned above, there are various investment options available for a retiree which can offer a much better return than simply saving all of the money and living a simple life off of it for the rest of the days. Theinvestment opportunities mentioned above enable you to get the most out of your retirement money and live the life to the fullest. It paves the way to all of your retirement plans and adventures. Investing your retirement money, in other words, is the way to live your life to the fullest in the old age. Regardless of how big and small an investment is, a rule of thumb applies to them all, i-e, you should always avoid putting all of your eggs in the same basket at all costs. This is why we have mentioned multiple opportunities so that you can diversify your investments and minimize the associated risks.
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